Travel news · 4 min read · November 28, 2025

How to save your 2026 holiday from the budget squeeze

The latest UK Budget has squeezed take home pay and pushed up the cost of flying, but that doesn't have to mean cancelling your next break. Here is how to adapt your plans - and use Holiday Extras - to save your 2026 holidays.

Short on time? Let us summarise this guide for you.

The Budget freezes tax thresholds, raises taxes on savings and confirms higher flight taxes in the next few years, which means many households will feel their holiday budget tighten. The good news is there are still plenty of ways to keep trips on the calendar. Focus on saving money around the edges of your journey, not just on the flight. Book airport parking and hotels early to lock in lower prices, swap premium cabins for economy but upgrade the airport experience with lounges and Fast Track, lean into better value UK breaks by rail or car, and protect what you spend with smart insurance and car hire cover. With a few tweaks and the right holiday extras, you can still get away and start your holiday before you even leave the ground.

The chancellor's latest Budget quietly shifts the way many of us will travel in the next couple of years. Frozen income tax thresholds mean more of every pay rise is swallowed by tax. Higher taxes on savings and investments nibble away at the pot we use to pay for our holidays. On top of that, flight taxes are set to rise again, especially for long haul and premium cabins.

None of that means you have to give up on a well-earned break. It simply means the parts of a trip you can control matter more than ever. Where you go, how you get there and which holiday extras you add can make the difference between cancelling the big trip and keeping it in the diary.

Tighten the flight costs you can control

By 2026 the tax built into your ticket will be higher on most routes, with long haul and premium seats hit hardest. You cannot haggle with the Treasury, but you can trim the costs that sit around the flight.

Airport parking is one of the easiest wins. Booked early, it can save fifty to one hundred pounds compared with turning up on the day, especially in peak season. Hotel and parking packages are another smart move. For the price of parking alone or a little more, you can add a pre flight night at an airport hotel, sidestep early morning traffic and avoid last minute taxi fares.

Treat these extras as part of the ticket price. If the flight itself is getting more expensive, make sure the rest of the journey is working hard to save you money and stress.

How to get the extra mile from your holiday car hire

We'll help you pick the right car and avoid the pitfalls of hiring a car abroad...

In Tips & Advice October 22, 2025

Go now, not later

Air Passenger Duty goes up in April.

It isn't April yet!

If you've been thinking of flying somewhere exotic and far away, long-haul is going to take the brunt of the higher APD regime coming in the new financial year. Our winter is also summer in the southern hemisphere, so that's two good reasons to go now if you were dreaming of a bigger trip. It's cold in England, and flying is going to get more expensive. Thailand's cheap, and sunny, and the flights are cheaper now than they will be by spring.

Trade down the flight but trade up the airport experience

Premium cabins are where the Budget bites hardest. Many travellers will decide that this is the year to fly economy instead. That does not mean the start of your holiday has to feel basic.

Airport lounges turn a standard ticket into a treat without paying premium cabin taxes. Food and drink are included at a fixed price, which often works out cheaper than feeding a family in the terminal. For early departures, a lounge can be the difference between a rushed breakfast on your lap and a calm sit down meal before you board.

Add Fast Track and you get a smoother route through security at the busiest times of year. When you have traded down your seat, upgrading the airport experience is an affordable way to keep the holiday feeling special.

Lean into UK breaks and European short haul

While flying is getting more expensive, the Budget has frozen regulated rail fares and fuel duty again. That makes UK travel and shorter hops to Europe relatively better value.

For many families, the answer is not to cancel the big holiday. It is to reshape it. Two shorter breaks can cost less than one long haul adventure once you take higher taxes into account. A couple of UK city stays by train, a countryside cottage or coastal weekend, then a short haul summer week in Europe can keep everyone happy without blowing the budget.

Airport hotels help here too. They work as convenient bases for early departures, but also as park and stay options for UK trips, festivals or visits to theme parks and attractions. Attraction tickets booked in advance can shave money off days out and keep the focus on making memories, not counting pennies at the gate.

Make your time off go further

If money is tight, use your annual leave wisely. Our guide shows how to turn 27 days off into 61 days of holiday time in 2026.

In Tips & Advice October 22, 2025

Protect the holiday you can afford

When budgets are under pressure, losing money to cancellations, delays or unexpected charges hurts more than ever. That is why protecting the holiday you can afford is just as important as finding the right deal in the first place.

Good travel insurance puts a safety net under your plans. If illness, disruption or other surprises force a change, you are less likely to lose the whole cost of the trip. Car hire excess cover is another quiet essential. It can cost a few pounds a day up front but could save hundreds if something happens to the vehicle while you are away.

Think of it this way. You have worked hard for your holiday. In a post Budget world, a small extra spend on protection can stop a single mishap from wiping out next year's plans as well.

Book earlier and bundle smarter

When prices are rising gradually across the board, it pays to be the traveller who plans ahead. Airport parking, hotels and lounges are all cheaper and easier to secure if you book early. Leave it until the week before departure and you will pay for the privilege.

Bundles help too. Hotel and parking packages, or deals that include parking, a lounge visit and even Fast Track, often cost less than buying each extra separately. They also turn the start of your holiday into one simple, predictable figure rather than a stack of unknown costs on the day.

Flexible cancellation policies give you confidence to book early without feeling locked in. If plans change, you can move your extras along with your trip.

Look out for local visitor charges

The Budget gives mayors the power to introduce visitor levies on overnight stays in English cities. These will be small at first but they still add another line to the bill for hotels and holiday lets.

Rather than avoiding city breaks altogether, build this into your planning. Compare different areas of a city, look at airport or out of centre hotels with good transport links and keep an eye on which destinations introduce charges first.

City taxes are already a fact of life in many parts of Europe. As they arrive in more UK destinations, smart holidaymakers will respond by shopping around and choosing deals that keep the total cost of the stay under control.

Put it all together and the message is simple. The Budget has made some parts of travel more expensive, but it has not cancelled your holiday. Focus on the parts you can control. Use airport parking, hotels, lounges and protection products to save money and stress. Plan earlier, bundle smarter and lean into the destinations that now offer the best value. With the right extras on your side, you can keep your holiday plans alive and start relaxing before you even reach the gate.